Industry report – Developments in the PV industry: Impact on installers

Massive increase in demand for photovoltaic systems

Whereas 10 years ago renewable energies and the PV industry were only onlookers in the power generation sector, they are now taking center stage. The geopolitical changes of the past months combined with the climate-related necessities for the transformation of the energy supply will lead to massively increasing demand for solutions for power generation by renewable energies, especially by photovoltaic systems, throughout Europe in the coming years.

In addition to large-scale projects, the integration of PV systems on the approx. 11 million existing properties, only 10-20% of which are currently being used, will be particularly important. While decentralized power supply and rooftop PV systems were rather “nice to have” solutions in recent years, they are becoming the focus of the drastic restructuring of the energy supply. According to the German Federal Network Agency, PV systems without tenders, mainly rooftop PV systems, already accounted for 3.9 GW in 2021, i.e. about 75% of total new installations. These annual volumes will have to increase almost fivefold in order to achieve the targets set.

In addition to the shortage of qualified personnel, especially in the field of electrical engineering but also in installation teams, the increase in complexity (storage, charging column, heat-air pump, smart gateways) as well as the readiness to deliver create major challenges for the PV installation industry.

Especially smaller businesses and solar-only installers will need to address these tasks more rapidly, as the external demand shock will necessitate a quicker consolidation of power and heating services. In addition, the much higher inventory levels required to reduce the long-term supply chain problems ahead pose a greater financing problem for the highly fragmented PV installation market.

A few dominant market players have become the focus of various investor groups in the last two years, which are gaining market share with strong financial power, high commitment to efficient structures, and attractive employee training.

Our role

Steinbeis M&A has been in contact with 250 PV installation companies as well as solar installers during the last months and has conducted about 80 interviews in order to find solutions for the changing market conditions (complexity, financing requirements, etc.) and the emerging competitive situation to secure the own market position.

The enormous challenges for the PV industry, results from our interviews and possible solutions were summarized by Steinbeis M&A in an industry report.

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